On Monday morning, the Brent price is balancing at $113 per barrel The commodity marker remains uncertain – the supply isn’t expanding as quick as it is expected to, and the demand might drop as well.
China is cancelling lockdowns but it does not necessarily mean that the country will start increasing its oil import right away. There are doubts about the Chinese economy’s ability to quickly and steadily expand at a time when the entire world is fighting inflation and afraid of recession.
OPEC+ members are working according to their earlier approved plan to increase oil production. This factor might have calmed down financial markets but Libya remains a mess and the Iranian oil won’t come to the commodity market in a while. Taken together, all these factors create a rather controversial basis.
In the H4 chart, having completed the correctional wave at 107.30, Brent continues growing towards 113.30 and may later consolidate there. After that, the instrument may break the range to the upside and form one more ascending wave with the target at 117.60. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving near the lows outside the histogram area, which means that it may grow to reach 0 and the uptrend in the price chart may continue.
As we can see in the H1 chart, after finishing the ascending wave at 113.30 along with the correction down to 110.15, Brent has rebounded from the latter level. Possibly, the asset may break 113.30 and then continue growing towards 117.70. Later, the market may correct to return to 113.30 and then form one more ascending structure with the first target at 119.50. From the technical point of view, this idea is confirmed by the Stochastic Oscillator: after rebounding from 50, its signal line is expected to continue moving towards 80.
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